Commenting on the letter from International Accounting Standards Board (IASB) head Hans Hoogervorst to the European Securities and Market Authority, saying that "certain European banks have not properly capitalized the Greek risk," the major French economic weekly Challenges compares what is happening now with the first step towards passing the original Glass-Steagall Act of 1933.
The former Dutch Finance Minister, Hoogervorst admits he is "no technical expert," but replies to the bankers' howls regarding his expertise, "Sometimes you need an 'outsider' who asks the basic questions." Is history repeating itself? asks Challenges: "This reminds us how the famous Glass-Steagall Act came about in the United States ... in 1933. It was Ferdinand Pecora, a young New York prosecutor, an Italian émigré, with no knowledge of financial practices, who investigated the case of the banks, by putting it on a moral plane. At that time, American bankers blatantly had the upper hand in corrupting officials, some of them were financing the parties of Hitler and Mussolini, and all succeeded in tax evasion.
"By convincing the public that a profound reform of the banking system was required, the prosecutor permitted the vote for the Glass-Steagall Act. Pecora and Hoogervorst, the same battle? One thing is sure: we should be suspicious of the experts, recalling that it was an amateur who built Noah's Arc and an expert who laid the plans for the Titanic..."
The former Dutch Finance Minister, Hoogervorst admits he is "no technical expert," but replies to the bankers' howls regarding his expertise, "Sometimes you need an 'outsider' who asks the basic questions." Is history repeating itself? asks Challenges: "This reminds us how the famous Glass-Steagall Act came about in the United States ... in 1933. It was Ferdinand Pecora, a young New York prosecutor, an Italian émigré, with no knowledge of financial practices, who investigated the case of the banks, by putting it on a moral plane. At that time, American bankers blatantly had the upper hand in corrupting officials, some of them were financing the parties of Hitler and Mussolini, and all succeeded in tax evasion.
"By convincing the public that a profound reform of the banking system was required, the prosecutor permitted the vote for the Glass-Steagall Act. Pecora and Hoogervorst, the same battle? One thing is sure: we should be suspicious of the experts, recalling that it was an amateur who built Noah's Arc and an expert who laid the plans for the Titanic..."
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